Commodity derivatives volume reaches four-month high

The Singapore Exchange recently released its market statistics for July.

Commodity derivatives volume climbed 57% year-on-year (YoY) to 3.6 million contracts in July, the highest since March, according to the latest market statistics of the Singapore Exchange (SGX).

This was because iron ore derivatives volume showed a gain of 68% YoY to 3.3 million contracts on the back of heightened volatility, as market participants reacted to developments in China’s property sector. 

SGX reported that iron ore remains an efficient macro proxy and the SGX Commodities solution enables participants to express their views on the broader economy. The volume of SGX SICOM rubber futures, the world’s pricing bellwether for natural rubber, increased 18% YoY to 148,290 contracts.

Derivatives traded volume across multiple asset classes rose 1% YoY in July to 20.5 million contracts, with derivatives' daily average volume (DDAV) up 4% YoY.

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Meanwhile, foreign exchange (FX) futures volume on SGX FX rose 16% YoY in July to 2.5 million contracts or $205.21b (US$149b) on a notional basis. The volume of SGX USD/CNH Futures – the most widely traded international RMB futures – climbed 34% YoY to 1.1 million contracts on increased risk-management demand, as investors focused on China's economic outlook.

STI

The benchmark Straits Times Index (STI) advanced 3.5% month-on-month (MoM) to 3,211.56 in July. Total securities market turnover value stood at $18b, with securities daily average value (SDAV) at $901m, a decrease comparing MoM. However, SDAV showed more resilience when compared to other regional markets.

“Stock investors were broadly on the sidelines for most of July amid continued concern over the path of the world economy, before a pickup towards month-end. The U.S. reported a second consecutive quarter of negative growth, while the International Monetary Fund cut its forecasts for major economies including China, citing “an increasingly gloomy and uncertain outlook”,” SGX said.

Secondary Fundraising Grows

Secondary fundraising ballooned to almost $2.05b, a 141% increase YoY. This was the largest amount since June 2021. Mapletree Commercial Trust led with a rights issue, whilst four other companies successfully raised funds via placements.

During the month, SGX Securities saw a secondary listing of Emperador Inc. on Mainboard. The company, which is primary listed in the Philippines, is a leading global integrated manufacturer, bottler and distributor of brandy, Scotch whisky and other alcoholic beverages.

On SGX Fixed Income, Asia’s leading international bond marketplace, the amount issued from 176 new bond listings totalled $45.9b in July, the highest since April. Highlights for the month included a $2.62b (US$1.9) three-tranche senior notes offering by Nomura Holdings, NTT Finance Corp.’s $2.07b (US$1.5b) three-tranche Green bonds, TSMC Global Ltd.’s $1.38b (US$1b) dual-tranche bond offering, as well as Housing & Development Board’s $1.1b five-year Green bond.